THE MONTERREY INTERNATIONALIZATION BEHAVIOR
DOI:
https://doi.org/10.46273/jobe.v10i2.318Keywords:
internationalization behavior, Monterrey multinationals, OXXOAbstract
The northern Mexican city of Monterrey is well-known for its high economic development, strong industrial network, and for being the based city of a great number of multinationals from Mexico. However, its business culture has been historically developed in an environment with a lack of inside competition, repercuting their internationalization behavior. In this paper, we develop a binary decision model of Foreign Direct Investment based on the behavioral preferences that characterize multinationals of Monterrey. To test its efficiency, we use the internationalization process of the convenience store chain OXXO, finding that there is a preference for greenfield type of investment in markets with lower levels of competition, and brownfield type of investment for markets where is costly the control over the competition. These factors satisfactorily explain the Foreign Direct Investment process of OXXO in Chile and Peru, except for Brazil, in which we suggest the decission was not optimal. Finally, we discuss that our model could be explanatory for other multinationals from Monterrey and cities with similar business culture history.
References
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Boddin, D. (2016). The role of newly industrialized economies in Global Value Chains. International Monetary Fund, Working Papers, 16(207).
Casson, M. (2014) Coase and international business: the origin and development of internalization theory. Managerial and Decision Economics, 36(1), 55-66.
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Luo, Y. & Tung, R. (2007). International expansion of emerging market enterprises: A springboard perspective. Journal of International Business Studies, 38(4), 481-498.
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Reyna, M. & Kramer, J.P. (2012). Notes for the history of beer in Mexico. National Institute of Anthropology and History. https://mediateca.inah.gob.mx/islandora74/islandora/object/libro3A754
Santa, I. (2014, June 30). Seis factores clave que explican el ´exito de Oxxo [Six key factors that explain the success of Oxxo]. El Financiero. https://www.elfinanciero.com.mx/empresas/seis-factores-clave-que-explican-el-exitode-oxxo/
Troncoso, J. (2016, June 7). FEMSA concreta compra de Big John y augura guerra con supermercados en Chile [FEMSA completes the purchase of Big John and predicts war with supermarkets in Chile]. https://www.df.cl/empresas/retail/femsa-concreta-comprade-big-john-y-augura-guerra-consupermercados-en
UNESCO (2008, October 15). Fundidora Monterrey Blast Furnaces. http://whc.unesco.org/en/tentativelists/5393/
Valdevez, G. (2021, March 16). A Ride Through the Brazilian Convenience Store Market. https://www.globalconveniencestorefocus.co.uk/features/brazilian-convenienceretail-market/
Vernon, R. (1966). International investment and international trade in the product cycle. The Quarterly Journal of Economics, 80(2), 190-207.
von Thunen, J. (1826). Die isolierte Staat in Beziehung auf Landwirtshaft und Nationalokonomie [The Isolated State]. Pergamon Press, New York. English translation by Wartenberg C M in 1966, P.G. Hall, editor.
Williamson, O. (1981). The Economics of Organization: The Transaction Cost Approach. American Journal of Sociology, 87(3), 548-577.
quienes-somos.html
Arriola Becerra, A. L. & Meléndez Martínez, G. (2017). Las estrategias de las tiendas de conveniencia ante la entrada de nuevos competidores en el Perú. Analisis del caso Tambo [The strategies of convenience stores before the entry of new competitors in Peru. Analysis of the Tambo case]. [Bachelor’s thesis, Peruvian University of Applied Sciences]. Peruvian University of Applied Sciences.
Blomstrom, M. & Kokko, A. (1981). Multinational corporations and spillovers. Journal of Economic Surveys, 12(2).
Boddin, D. (2016). The role of newly industrialized economies in Global Value Chains. International Monetary Fund, Working Papers, 16(207).
Casson, M. (2014) Coase and international business: the origin and development of internalization theory. Managerial and Decision Economics, 36(1), 55-66.
Coase, R. (1937). The nature of the firm. Economica. New Series, 4(16), 386-405. https://www.jstor.org/stable/2626876
Coca-Cola (2022). Coca-Cola System. https://investors.cocacolacompany.com/about/coca-cola-system
COFECE (2020, November). Competence study in the modern channel of convience commerce of food and beverages. https://www.cofece.mx/wp-content/uploads/2020/11/EEcomercio-031120-FINAL-002.pdf
Corrales, S. (2012). The basic industry of Monterrey, Mexico, at the current globalization process. International Journal of Latin America Studies, 2(1), 27-56.
Del Campo, M. (2022, February 28). Oxxo ya es due˜na de OK Market: suma 258 tiendas en Chile [Oxxo already owns OK Market: it adds 258 stores in Chile] https://www.bloomberglinea.com/2022/02/28/oxxo-ya-es-duena-de-ok-marketsuma-258-tiendas-en-chile/
Dunning, J. & Lundan, S. (2008). Multinational enterprises and the global economy, Second edition. Edward Elgar Publishing Ltd.
Esquivel, G. (2000). Geography and economic development in Mexico. Inter-American Development Bank, Research Department.
Estrada, R. (2020, December 1). Oxxo inaugura su primera tienda en Brasil [Oxxo inaugurates its first store in Brazil]. El Financiero. https://www.elfinanciero.com.mx/empresas/oxxo-inaugura-su-primera-tienda-en-brasil/
FEMSA (2021). Nuestra historia [Our History]. https://www.femsa.com/es/acerca-defemsa/nuestra-historia/
FEMSA (2022a, April 8). Informe de Sostenibilidad 2021 [Sustainability Report 2021]. https://informeanual.femsa.com/pdf/IA-InformeDeSostenibilidad2021.pdf
FEMSA (2022b). División Proximidad [Proximity Division]. https://www.femsa.com/es/unidades-de-negocio/femsa-comercio/division-proximidad/
Fernandez de Castro, E. P. (1982). The impact of the American Civil War in the Mexican American frontier [Bachelor’s thesis, The College of Mexico]. The College of Mexico, Daniel Cosio Villegas Library. http://hdl.handle.net/20.500.11986/COLMEX/10001801
Flores, O. (2004, October 27-29). Monterrey and the globalization: Metropolis, infrastructure, and magnus industrial project, 1940-2004. [Paper presentation]. Second National Congress of Economic History, Mexico City, Mexico. http://www.economia.unam.mx/amhe/memoria/simposio01/Oscar%20FLORES.pdf
Forbes (2022). The Global 2000. https://www.forbes.com/lists/global2000/
Garita, G. & van Marrewijk, C. (2007, September). Macroeconomic determinants of cross-border mergers and acquisitions. Erasmus University Rotterdam Working Paper.
Gestión (2015, September 22). Duelo de fusiones de Coca-Cola Femsa con Arca avanza hacia Chile [Coca-Cola Femsa and Arca mergers duel advances towards Chile]. https://gestion.pe/economia/empresas/duelo-fusiones-coca-cola-femsaarca-avanza-chile-100592-noticia/
Herbert, S. (2002, June). We and they: the human urge to identify with groups. Industrial and Corporate Change, 11(3), 607-610.
Ho, T., Phan, T., & Le-Hoang, V. (2021). Positioning customer-based convenience store image: a multidimensional scaling approach via perceptual map. Journal of Distribution Science, 19(2), 15-24.
Huesca-Dorantes, J.L., Michailova, S., Stringer, C. (2018). Aztec multilatinas: Characteristics and strategies of Mexican multinationals. Review of International Business and Strategy, 28(1), 2-18.
Ialimentos (2015). No hemos llegado al tama˜no que queremos en Colombia: Coca-Cola FEMSA [We have not reached the size we want in Colombia: Coca-Cola FEMSA]. Revista Ialimentos. https://www.revistaialimentos.com/ediciones/edicion-13/no-hemosllegado-al-tamano-que-queremos-en-colombia-coca-cola-femsa/
IMCO (2021, March). Hablemos de ingresos en los estados [Let’s talk about income in the states]. Instituto Mexicano para la Competitividad. IMCO. (2022). Indice de Competitividad Estatal 2022 [State Competitiveness Index 2022]. Instituto Mexicano para la Competitividad.
Luo, Y. & Tung, R. (2007). International expansion of emerging market enterprises: A springboard perspective. Journal of International Business Studies, 38(4), 481-498.
Montoya, E. (2018, December). Las estrategias de entrada en mercados exteriores de OXXO [The strategy of entrance in foreign markets of OXXO]. Cases of Strategic Direction of Enterprise. http://www.guerrasynavas.com/pdf/AL-13.02-MXOXXO.pdf
OXXO (2022). Preguntas frecuentes [Frequently Asked Questions] https://www.oxxo.pe/faqs
Perez, L. (2017, August 15). FEMSA Comercio sigue sin poder reproducir el exito de Oxxo [FEMSA Commerce still can’t reply the OXXO’s success]. Forbes Mexico. https://www.forbes.com.mx/femsa-comercio-sigue-sin-poder-reproducir-el-exito-deoxxo/
Reyna, M. & Kramer, J.P. (2012). Notes for the history of beer in Mexico. National Institute of Anthropology and History. https://mediateca.inah.gob.mx/islandora74/islandora/object/libro3A754
Santa, I. (2014, June 30). Seis factores clave que explican el ´exito de Oxxo [Six key factors that explain the success of Oxxo]. El Financiero. https://www.elfinanciero.com.mx/empresas/seis-factores-clave-que-explican-el-exitode-oxxo/
Troncoso, J. (2016, June 7). FEMSA concreta compra de Big John y augura guerra con supermercados en Chile [FEMSA completes the purchase of Big John and predicts war with supermarkets in Chile]. https://www.df.cl/empresas/retail/femsa-concreta-comprade-big-john-y-augura-guerra-consupermercados-en
UNESCO (2008, October 15). Fundidora Monterrey Blast Furnaces. http://whc.unesco.org/en/tentativelists/5393/
Valdevez, G. (2021, March 16). A Ride Through the Brazilian Convenience Store Market. https://www.globalconveniencestorefocus.co.uk/features/brazilian-convenienceretail-market/
Vernon, R. (1966). International investment and international trade in the product cycle. The Quarterly Journal of Economics, 80(2), 190-207.
von Thunen, J. (1826). Die isolierte Staat in Beziehung auf Landwirtshaft und Nationalokonomie [The Isolated State]. Pergamon Press, New York. English translation by Wartenberg C M in 1966, P.G. Hall, editor.
Williamson, O. (1981). The Economics of Organization: The Transaction Cost Approach. American Journal of Sociology, 87(3), 548-577.
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Published
2022-12-23
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How to Cite
THE MONTERREY INTERNATIONALIZATION BEHAVIOR (J. Reyes-Simpe , Trans.). (2022). Journal of Business And Entrepreneurship, 10(2), 109-121. https://doi.org/10.46273/jobe.v10i2.318
